Speaker John Arch of La Vista, right, meets with State Sens. Danielle Conrad of Lincoln and Tom Brandt of Plymouth on the floor of the Nebraska Legislature. March 30, 2026. (Zach Wendling/Nebraska Examiner)
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LINCOLN — Nebraska’s 60-day legislative session made history this year as the latest lawmakers had ever passed the state’s budget adjustments, on Day 54. The normal deadline to finalize the budget is Day 50.
The budget bills were held up — not by an appropriation dispute — but by a policy debate centering on the potential inclusion of two proposals: a $3.5 million school vouchers program recommended by Gov. Jim Pillen and a proposal to permanently extend pandemic-increased income eligibility levels for the state’s child care subsidies.
The disagreement led Legislative Bill 1071 to be blocked from advancing twice. It progressed only after lawmakers removed both proposals.
The weeklong impasse raised questions about whether policy changes should be made using the legislation that makes up the state budget. If you ask term-limited Speaker John Arch of La Vista, he’ll say it’s inappropriate, and he hopes returning lawmakers will remember the lesson from this session and avoid putting policy tweaks into future budget bills.
But other lawmakers and state officials had a different view. State Sen. Rob Dover of Norfolk, a leader in the push to include the school vouchers program, said policy changes have often been included in Nebraska budget legislation over the past decade.
While Dover said policies were a common component of past budgets before State Sen. Rob Clements of Elmwood took over as chair of the Legislature’s budget-writing Appropriations Committee, former chair John Stinner said the only instance he remembered was in 2018. That also happened to be the last time a state budget bill stalled multiple times during floor debate.
That year, lawmakers considered a proposal from then-Gov. Pete Ricketts to ban federal Title X funds from going to an organization that provides abortions. It was controversial enough to keep the state budget from advancing through a filibuster-ending cloture motion twice, before Stinner said the language had been watered down enough to allow the budget to pass on Day 53 of 2018’s 60-day session. The following year, Ricketts again tried to add the language to his budget proposal, but Stinner said he removed it early in the 2019 session.
Dover said in 2020, during Stinner’s stint as Appropriations chair, the Legislature established the Nebraska Career Scholarship program through its budget adjustments. According to Stinner’s recollection, he said he believed the proposal added onto an existing program, and had a like-minded standalone bill that was considered during the same session.
Clements said he can recall past policy proposals included in budget bills throughout his chairmanship but noted that previous examples were minor changes in comparison to the policies proposed this session.
“Nothing that made me lose sleep like this year,” Clements said.
Define ‘policy’
Part of the problem is that there isn’t a clear definition of what is and isn’t considered a policy change in the state budget. State Sen. Jason Prokop of Lincoln, an Appropriations member who pushed for the budget to include the child care subsidy tweak, acknowledged the line is blurry and can differ based on individual perspectives.
Multiple sources said one clear boundary is that the state budget should not create new government programs. State Sen. Machaela Cavanaugh of Omaha, another Appropriations member, said this is a precedent the Pillen administration has turned on its head.
Theoretically, every budget bill could be considered policy, as appropriation adjustments have the potential to impact virtually any state program or government service.
“I joke about this all the time … that the budget is the biggest policy document we have,” said Kenny Zoeller, director of the governor’s Policy Research Office.
However, implementing policy through budget bills can cause complications, as Nebraska budget bills only exist in statute for a maximum of two years. The budget bills passed this year will only last for one year, as they adjust the biennial budget lawmakers passed in 2025.
The K-12 voucher program aimed to offer private school scholarships for a single school year before a federal tax credit Pillen embraced kicks in to provide financial aid.
For the child care subsidy program, Prokop said supporters wanted to put it in the budget bills because state budget language sets the income eligibility requirement for subsidies at 130% of the federal policy level, while the proposal seeks to permanently increase the limit to 185%. The current limit is at 185%, but the law that raised it is scheduled to revert back to the lower level later this year.
Cavanaugh objected to the program’s inclusion during committee discussions, arguing it was bad governance because the state budget is not supposed to bind future legislatures. When the committee didn’t heed her advice, Cavanaugh left the meeting early.
Though the child care subsidy program change was eventually removed from the budget bills, lawmakers are currently considering a standalone bill to permanently increase the income eligibility limit to 185% in LB 304. Prokop said if lawmakers pass that bill, it would accomplish the same goal of adjusting the limit set in future budget bills.
Pillen proposed another policy change this year that didn’t make it out of committee — to remove diversity, equity and inclusion (DEI) programs from Nebraska’s higher education institutions. The Appropriations Committee didn’t spend much time considering the proposal, with some members noting they couldn’t find any DEI language in the budget to remove.
Lee Will, director of the state Department of Administrative Services, said the recommendation was meant to add “boiler plate” language to current and future budget bills, similar to the severability clause that was also a new addition to this session’s budget adjustments.
State Sen. Megan Hunt of Omaha questioned this severability clause during several floor debates on the budget bills. While some lawmakers said they viewed it as a wise safety net, Hunt theorized that it was only included because state officials were worried that some controversial components within the legislation could jeopardize the entire state budget.
“What are we doing in this budget that gives us so much concern that we need to add, for the first time ever, a severability clause?” Hunt asked. “I think it’s a tell that we are not confident.”
Tom Bergquist, former director of the Legislative Fiscal Office who worked in the office for 46 years before his retirement, said a severability clause might not be necessary in state budget bills. He said the reason such a clause has not been included in previous budgets is because of an old Nebraska Supreme Court ruling that implemented the same protection, saying that if a portion of the state budget is rejected by the courts, it doesn’t impact the full budget.
The path forward
The concept of using the state budget to implement policy changes comes with a range of opinions. Multiple sources — including Cavanaugh, Stinner and Arch — agreed that it undermines the legislative process, which sees bills referred to standing committees based on members’ expertise.
However, Zoeller argued there is still an avenue for other committees to consider budget policies that fall in line with their members’ backgrounds. He noted that legislative committees have the power to call for a public hearing on virtually any topic, even if it doesn’t involve a bill referred to the committee.
Will argued that there is benefit to including policy in budget bills, as it offers a “holistic” understanding of Nebraska state government. It simplifies the process for lawmakers outside the Appropriations Committee, Will said, so they don’t have to track multiple bills that impact the state budget.
State Sen. Merv Riepe of Ralston countered that this might be a negative. He said he hates omnibus bills — single bills that include a package of other legislation attached to it — which have become a growing trend in recent legislative sessions.
Riepe argued this practice often stymies legislative progress and threatens good proposals through the inclusion of “poison pills” — controversial policies that risk siphoning votes away from the full package.
Dover argued there is a place for policy in state budget bills, but said it’s probably best used in moderation. He said it’s also important for lawmakers to recognize when they don’t have the votes needed to attach a policy to the budget.
Riepe was serving in the Legislature when the budget last stalled in 2018 before he was term-limited out for four years, but he doesn’t recall much of the debate. He noted, however, that debating policy in the budget was slightly less risky that year because Nebraska’s budget was in a more stable place.
This session, lawmakers debated the budget to fill a $646 million projected deficit, but even with the budget balanced, lawmakers returning next year face a structural deficit with no definitive end in sight. Critics of adding policy to state budget bills have argued that the practice distracts lawmakers from vetting other components of the budget.
“The tension between infinite priorities and finite resources has always been part of the budget process,” wrote Rebecca Firestone, executive director of progressive think tank OpenSky Policy Institute. “Typically, these decisions are difficult, and warrant deliberate consideration. The Nebraska Legislature has a long tradition of keeping policy changes out of the budget, to stay focused on the essential work of funding state services. We have seen … that when you add policy into the mix, it obscures the budgeting process and grinds it to a halt.”
Conservative think tank The Platte Institute declined to comment on the subject.
This story is provided by States Newsroom, a nonprofit state news network and Blox Digital content partner.
